Peter Witts, CPA PC

07/21/2026

Receiving an SBIR/STTR award is a significant achievement, but managing the funds correctly is just as important.

Many awardees are familiar with the technical side of their project, but questions often arise when it's time to manage the financial requirements.

How do you document drawdowns? What belongs in an SF-425 report? How do you reconcile your accounting records to ensure everything ties together?

Strong financial management isn't just about meeting reporting deadlines; it's about maintaining accurate records, supporting allowable costs, and staying prepared for future reviews or audits.

In our latest article, we explain:

✔ What PMS drawdowns are and how they fit into award management

✔ The purpose of the SF-425 Federal Financial Report

✔ Why regular grant reconciliations matter throughout the life of an award

✔ Best practices for building a reliable financial process from day one

Whether you're managing your first SBIR/STTR award or have multiple federal awards in progress, understanding these financial responsibilities can help you stay organized and compliant.

Learn more about this topic: https://www.wittscpa.com/blogs/pms-drawdowns--sf-425-reports--and-grant-reconciliations--what-awardees-should-know

Federal grants can provide critical funding for research, innovation, and program growth. But once the award is active, the financial work does not stop at receiving the grant notice or setting up...

07/16/2026

SBIR/STTR funding can come in the form of a grant or a contract; but the accounting requirements aren't always the same.

Understanding that distinction is important because it can affect everything from cost tracking and reporting to compliance obligations and financial management.

While both provide federal funding, grants and contracts are governed by different rules and expectations. Assuming they can be managed the same way can create unnecessary challenges down the road.

In our latest article, we explore:

✔ The key differences between grant and contract accounting

✔ How each impacts financial management and compliance

✔ Why understanding these differences early can help position your organization for long-term success

Whether you're preparing your first proposal or managing multiple federal awards, understanding the financial side of each funding mechanism is just as important as the technical work.

Learn more about this: https://www.wittscpa.com/blogs/grant-vs--contract-accounting--what-sbir-sttr-companies-need-to-understand

SBIR and STTR funding can come through different types of federal award instruments, including grants, contracts, and cooperative agreements. For founders and research-driven teams, the difference...

07/03/2026

Happy Fourth of July!

Two hundred and fifty years of liberty is worth celebrating with everything you have got. Whether that means fireworks, family, or a mouth-watering backyard cookout, our team hopes you have a patriotic and joyful celebration.

Please note that the office will be closed on Friday, July 3rd, in observance of Independence Day. We will be back after the holiday weekend and look forward to connecting with you soon.

06/18/2026

A proposal budget is not just a document used to win funding.

If awarded, it becomes the financial starting point for how the work will be performed, tracked, billed, reported, and supported.

For SBIR/STTR companies, federal contractors, and grant-funded organizations, weak budget assumptions can create real post-award challenges, including labor tracking issues, unsupported indirect rates, cash flow strain, and audit readiness concerns.

In our latest article, we break down how proposal budgets can create compliance problems after award, and what companies should consider before submission.

Learn more about this topic: https://www.wittscpa.com/blogs/how-proposal-budgets-create-post-award-compliance-problems

A proposal budget can feel like a document created only to win funding. For SBIR/STTR applicants, federal contractors, and grant-funded organizations, it is often prepared under pressure, near the...

06/04/2026

SBIR/STTR budgets don’t get approved because they “look reasonable”; they get approved when reviewers can clearly see the logic, the allowability, and the documentation behind the numbers.

If you’re building your next budget, a few things matter more than most founders realize:

*how you tie labor + effort to the scope
*how you justify rates (and avoid inconsistent assumptions)
*how you structure indirects so they’re defensible
*how you reduce “back-and-forth” questions from reviewers

We put together a practical guide on how to build an SBIR/STTR budget reviewers can trust, without overcomplicating it.

Learn more here: https://www.wittscpa.com/blogs/how-to-build-an-sbir-sttr-budget-reviewers-can-trust

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A strong SBIR/STTR proposal is not built on the technical narrative alone. The budget also plays an important role in how reviewers, agencies, and contracting teams understand whether the proposed...

05/29/2026

Many companies are focused on winning their Phase I SBIR award.

Fewer are thinking about what happens next.

As companies move from Phase I to Phase II, the expectations often increase, with larger budgets, additional reporting requirements, more complex cost tracking, and greater scrutiny over financial systems.

The accounting processes that worked during the early stages of growth may not be enough to support the next phase.

In our latest article, we explore signs that it may be time to strengthen your accounting system and why preparing early can help you avoid challenges later.

Read the full article: https://www.wittscpa.com/blogs/phase-i-to-phase-ii--when-sbir-companies-need-a-stronger-accounting-system

SBIR and STTR funding often starts with a focused Phase I award: prove feasibility, advance the research, and validate the technical direction. But as companies move toward Phase II, the financial...

05/28/2026

Applying for SBIR/STTR funding is exciting — but before submitting an application, it’s important to ask one key question:

Is your business financially prepared?

Many applicants focus heavily on the technical side of the proposal, but financial readiness plays a major role in long-term success and compliance.

In this article, we break down:
✔ Key financial areas to review before applying
✔ Common readiness gaps we see with applicants
✔ Why strong accounting and compliance systems matter early on

Preparing now can help avoid bigger challenges later.

Read the full article here: https://www.wittscpa.com/blogs/before-you-apply--financial-readiness-checklist-for-sbir-sttr-applicants

SBIR and STTR funding can help innovative companies move from early research to commercialization, but the financial side of the application is often underestimated.A strong technical idea matters,...

04/30/2026

Managing multiple contracts sounds like a good problem to have until cost allocation gets complicated.

Over the years, I’ve seen that as contractors grow, the biggest challenges aren’t always technical; they’re operational. Things like shared resources, cost segregation, and consistency across contracts can quietly create risk if not handled properly.

And the tricky part is, these issues don’t always show up right away. They tend to surface later, often during audits.

If you're working across multiple contracts, it’s worth taking a closer look at how your costs are being allocated and whether your systems can keep up with that growth.

We put together a breakdown of the common challenges and how to approach them in practice.

Read more here:

As government contractors grow, managing a single contract often evolves into handling multiple contracts across agencies, funding types, and cost structures.While growth brings opportunity, it...

04/23/2026

Even experienced government contractors can get caught off guard by a DCAA audit — not because they’re doing “bad accounting,” but because a few small gaps can create big questions.

Here are some of the most common issues we still see:
*Timekeeping that isn’t enforced consistently (or lacks an audit trail)
*Labor distribution that doesn’t cleanly tie to payroll
*Direct vs. indirect cost treatment that changes month to month
*Unallowable costs not identified early

Documentation that exists… but doesn’t match what people actually do
If you’re preparing for a DCAA audit (or want to reduce risk before one shows up), we wrote a practical breakdown of what contractors still get wrong — and how to tighten it up before it becomes a finding.

Learn more here:

For many government contractors, preparing for a DCAA audit becomes a priority only when an audit notice is received.However, even experienced contractors — including those who have been through...

04/15/2026

SBIR/STTR has officially been reauthorized — but this isn’t just a continuation. It’s a shift.

On April 13, 2026, the program was signed into law, extending funding through 2031. While this brings stability, it also introduces new layers of oversight, disclosure requirements, and performance expectations.

For government contractors, this means:
🔹 More scrutiny around foreign ownership and affiliations
🔹 Increased due diligence and reporting requirements
🔹 Greater emphasis on commercialization and real-world outcomes

In our experience, the biggest challenge isn’t understanding the rules — it’s applying them consistently across operations.

If you’re participating in (or considering) SBIR/STTR programs, now is the time to review your systems, processes, and compliance readiness.

We broke down what this means in practice and what contractors should be preparing for next.

Read the full article here: https://www.wittscpa.com/blogs/sbir-sttr-reauthorization--new-opportunities--heightened-oversight--and-what-contractors-should-do-next

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On April 13, 2026, President Donald Trump signed into law the reauthorization of the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs, extending them...